Gartner optimistic about chip market in 2014

According to the latest forecast from Gartner Inc., the global chip market will be worth $336 billion in 2014, up 6.7 per cent from 2013. The market analyst said this is higher than the forecast of 5.4 per cent growth Gartner gave three months before.

The sequential growth in 2Q14 is outpacing previous expectations Gartner said. "2014 semiconductor growth is widespread across many chip types and applications," said Bryan Lewis, research VP at Gartner. "DRAM is once again expected to lead in 2014 with 18.8 per cent annual growth, but other areas are also doing well including analogue, FPGAs, ASICs and non-optical sensors. ASICs are driven by Apple, with strong sales of its iPhone expected in 2H14. ASICs will also benefit from the strong ramp of the latest video game console generation, particularly the Sony PS4 and Microsoft Xbox One. Overall semiconductor growth is widespread, with the non-memory segment growing 5.2 per cent in 2014, compared with only 0.8 per cent in 2013."

"Smartphones and ultramobile devices, including tablets, are the growth areas from a system point of view," said Ranjit Atwal, research director at Gartner.

"Traditional desk-based PCs and notebook units are continuing to decline 6.7 per cent in 2014. Total production unit growth for ultramobile devices, including tablets, is expected to rise over 30 per cent in 2014. Low-cost utility tablets (white box) continue to drive new growth in the tablet market."

DRAM pricing remains firm, and this, coupled with growth in key system markets, is helping propel the DRAM market to exceed $41 billion in 2014. Memory is a feast-and-famine market due to big supply and demand cycles, and Gartner predicts the next big memory oversupply downturn to hit in 2016, weakening overall semiconductor growth in that year.